The Big Money Bounce

ELECTION 2000

For Those Candidates Who Want To Reach The White House, Campaign-finance Reform Makes A Great Issue To Debate But Not One By Which To Abide.

May 28, 2000|By Michael Griffin, SENTINEL POLITICAL EDITOR

Even as Al Gore and George W. Bush decry campaign-finance abuses, they continue setting records for election-year fund-raising.

Texas Gov. Bush, the presumptive Republican nominee, calls for the banning of contributions from corporations and unions, then raises $15 million that the Republican National Committee will use to fuel so-called "soft-money" contributions to candidates.

Vice President Gore, Bush's Democratic rival, apologizes for 1996 abuses in the Clinton-Gore campaign and lays out a plan to tightly control election contributions -- then appeared onstage with Clinton in a fund-raiser this past week that netted the party about $26 million.

Look past the rhetoric at the bottom line of campaign accounts and one thing is clear: Election year 2000 is shaping up to be the most expensive in history.

"Getting around the rules has become the rule in politics," said Scott Harshbarger, president of Common Cause in Washington D.C. "There is always going to be money in politics, but the issue now is disclosure -- who's giving to who and for what reason?"

But while groups such as Common Cause are complaining about flaunting the rules, others argue rules are the problem.

Restrictions on campaign contributions endanger the system by limiting free speech and breed the corruption the rules are supposed to prevent, said Roger Pilon, vice president of legal affairs for the Cato Institute, a libertarian think tank in Washington, D.C.

"The reason you have soft money is that the government restricts the hard money that is easy to track," Pilon said. "The very idea that a $1,000 contribution is OK, but a $2,000 contribution is corruption is specious on its face."

Congress enacted the current federal campaign-finance law in 1974 in the wake of the Watergate scandal. The new law required candidates to disclose their donor lists. Donors were limited to giving candidates so-called "hard money" contributions of $1,000 for each primary election and $1,000 for each November contest. Hard money is money given directly to the candidate. The Federal Election Commission was created to enforce the rules.

That $1,000 limit remains in place. Candidates running for office, though, will find those $1,000 contributions don't go as far as they did when Gerald Ford was president.

In fact, inflation has reduced the value of that $1,000 contribution to about $274.

"It is an absurd limit when you think about the rigors of a campaign," Pilon said. "And it is incumbency protection, pure and simple. Incumbents are the ones who have the large networks of donors who can raise a lot of money in these $1,000 increments."

It didn't take Congress long to do the math. Less than five years after Ford signed the reform bill, Congress changed the playing field to give donors new -- and less accountable ways -- to give to campaigns.

Corporations and labor unions, banned from giving directly to candidates under the 1974 reforms, suddenly were allowed to make unlimited "soft-money" contributions to the political parties, whose number one goal is electing their nominee president. Soft money was initially meant for "party building" activities, but over time the Democrats and Republicans developed legally acceptable ways of spending that money to elect their candidate president.

As the parties found it tougher and tougher to finance their presidential campaigns on $1,000 contributions, they turned to soft money in larger and larger amounts to pay for campaign activities the candidates could not afford from their hard-money accounts.

The two major political parties, which raised $86 million in soft money in 1991-92, boosted their intake by 160 percent, to $224 million, in 1997-98.

These "soft-money" funds were at the heart of the 1996 campaign-finance abuses, when foreign sources pumped millions of dollars into Democratic coffers. The party said it would refund the money, and a Justice Department task force indicted 22 people. One of them, Gore friend and veteran fund-raiser Maria Hsia, recently was convicted of arranging more than $100,000 in illegal donations.

"We thought 1996 was going to be the watershed year," Harshbarger said, but "2000 is going to make 1996 look like the good, old days of campaign financing."

Bush chose not to take advantage of one of the integral parts of the 1974 reforms: partial public financing for presidential candidates who agree to limit spending. In his primary campaign, Bush refused federal money and went about raising more than $80 million, more than any candidate in history.